The Liberty All-Star Growth Fund, Inc. is a closed-end fund. What does that mean?
A closed-end fund is one that has a fixed number of shares, which are bought and sold on a stock exchange through a broker or other financial intermediary. By contrast, most mutual funds are "open-ended" funds that continually offer new shares to investors and redeem shares when requested by the investor. The All-Star Growth Fund is listed on the New York Stock Exchange, Liberty All-Star Growth Fund's ticker symbol is ASG). The Fund is priced just like any other stock traded on an exchange - that is, by the supply and demand for the stock. Open-ended mutual funds are not traded on stock exchanges; rather, purchases and redemptions are transacted at the net asset value by the fund sponsor.
What is the Fund's dividend policy?
The current policy is to pay distributions on its shares totaling approximately 6 percent of its net asset value per year, payable in four quarterly installments of 1.5% of the Fund's net asset value at the close of the New York Stock Exchange on the Friday prior to each quarterly declaration date. The fixed distributions are not related to the amount of the Fund's net investment income or net realized capital gains or losses and may be taxed as ordinary income up to the amount of the Fund's current and accumulated earnings and profits. If, for any calendar year, the total distributions made under the distribution policy exceed the Fund's net investment income and net realized capital gains, the excess will generally be treated as a non-taxable return of capital, reducing the shareholder's adjusted basis in his or her shares. If the Fund's net investment income and net realized capital gains for any year exceed the amount distributed under the distribution policy, the Fund may, in its discretion, retain and not distribute net realized capital gains and pay income tax thereon to the extent of such excess.